Changing Landscape of Phase I ESAs – What It Means for You

Author: Kathryn Peacock, Partner Engineering

With permission by the publisher, RMA Journal, and the author, Kathryn Peacock, EDR Insight is sharing one environmental professional’s reaction to the ASTM E 1527-13 revisions. Peacock’s detailed analysis of the changes in the areas of REC-CREC-HREC determinations, vapor migration and agency file reviews also includes the first concise breakdown on the expected impacts of the ASTM changes on pricing for Phase I ESAs. With thanks to Peacock, EDR Insight shares her article titled “Changing Landscape of Phase I ESAs.”

Kathryn Peacock serves as the Western Regional Manager for Partner Engineering and Science, a national environmental and engineering due diligence consulting firm. Kathryn has been practicing in the environmental and engineering due diligence field for over 12 years. Kathryn has worked on thousands of transactions, subsurface investigations, and site remediation projects. Her clientele includes many of the nation’s largest lenders, real estate investors, and corporations. Kathryn holds a bachelor degree in Soil Science from Prescott College and a Masters in Education from the Arizona Teachers Institute.

Within the last decade, many banks have adopted environmental risk management policies and programs in order to minimize their exposure to environmental risks.

Indeed, potential environmental liability has become increasingly relevant to the banking industry. Environmental risks can have far-reaching consequences if not addressed during the due diligence process. Potential risks that may be encountered during the transaction process include 1) a reduction in the value of a collateralized property if contamination is identified, 2) disruption of property transactions due to environmental cleanup requirements, and 3) possible cash flow problems due to cleanup costs, particularly in default situations.

Continue reading to see what Kathryn has to say about the key areas of revision to the ASTM E 1527-13 standard, including:

  • REC, HREC & CREC definitions
  • The new emphasis on assessing vapor migration
  • Conducting regulatory file reviews
  • Comparing Phase Is written in 2012 to a report written to the new standard
  • What the changes mean for risk managers

NOTE TO READERS: EDR Insight wishes to thank Kathryn Peacock and The Risk Management Association for the republication of this brief.